Starting tomorrow—Tuesday—the Department of Justice is taking aim at Google (NASDAQ:GOOG) (NASDAQ:GOOGL). That would make most investors get at least a little nervous, and indeed, Alphabet stock is down fractionally in Monday morning’s trading session. But what’s ahead for Google here? Is there a path to victory? Or is this going to take a lot of time and resources away from Google developing new and interesting technologies?
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Reports note that this will be the single biggest anti-monopoly trial since the government took on Microsoft back in the early 2000s. That trial ended with Microsoft shattered and rebuilt into two separate companies. While Microsoft mostly—or perhaps not so mostly, depending on who you talk to—recovered, it still left an indelible mark on the landscape. Now, Google’s getting its own watershed moment, and investors are already left wondering what will come next.
The trial is said to focus on agreements that Google made with other companies. One agreement focuses on what Google had to pay out to be the default search engine in other browsers like the iPhone Safari browser. The other type focuses on mobile devices that use the Android operating system and how those devices are required to preload at least some of Google’s apps. The government’s case focuses on how those arrangements restricted competition and made getting access to a user base pretty much impossible. Google, meanwhile, plans to fight back with the notion that its arrangements made for a better consumer experience and were therefore necessary.
Turning to Wall Street, with seven Buy ratings and one Hold, Alphabet stock is considered a Strong Buy by analyst consensus. Further, with an average price target of $145.50, Alphabet stock comes with a 6.22% upside potential.
